Exam 23: Agency Relationships in Business

Mirena serves in a representative capacity for Netanya. Orla is injured through Mirena's negligence. Netanya may be liable to Orla if Mirena's conduct occurred​

An agent is authorized to act on behalf and instead of a principal in doing business with third parties.

A power of attorney can permit an agent to transact all business for a principal.

Agency relationships only exist between employers and employees.

Fact Pattern 23-1​ Nadya and Owen work at Purified Water Company. Nadya is a sales representative who works with Purified's customers, including restaurants, grocery stores, and other businesses, as well as individual consumers. Purified closely supervises all of its sales reps, and dictates their schedules. Owen is an engineer who works in Purified's water treatment plant. -Refer to Fact Pattern 23-1. With respect to third parties, Nadya is Purified’s

An agency agreement can be implied by conduct.

Alexandra manages a Beans Bistro for Coffee Shops, Inc. To manage the business, Alexandra's authority can be inferred​

A principal has a duty to cooperate with the agent and to assist the agent in performing his or he duties.

Implied authority is authority declared in clear, direct, definite terms.

Brenda, a salesperson at a Cabinets & Countertops store, tells D'Antoni, a customer, "Buy your cabinets here, and I'll install them for half of what the store would charge." D'Antoni buys the cabinets, which Brenda installs for half the store's price. Brenda keeps the money. Brenda has breached​

Under the doctrine of respondeat superior, an agent is liable for any harm caused to a principal by a third party.

HomeBaked Bread Company hires Ike to sell the company’s products in a certain area. HomeBaked Bread agrees to pay Ike a salary, plus commission, for a trial period. They also agree that Ike can sell using any methods and during any hours that seem appropriate. The key factor in whether Ike is HomeBaked Bread’s employee is

If an agent has no authority but nevertheless contracts with a third party, the principal can be held liable on the contract.

If a principal is disclosed, the agent may be liable to a third party for the principal's nonperformance of a contract.

Spicy Wonder Hot Dog Vendors, Inc., grants its agent Teona an exclusive territory in which to sell Spicy Wonder Hot Dog products. Spicy Wonder Hot Dog cannot compete with Teona in that territory under the principal's duty of​

Under the law of agency, notice to the agent is notice to the principal.

Geoff serves in a representative capacity for Huck. To accomplish the objectives of this relationship, Geoff's authority can be implied​

A familiar example of an agent is the owner of a corporation.

Reynaldo is a delivery driver for Southeast Asian Noodle Company. Reynaldo does exactly what the company tells him. Reynaldo is

Vicarious liability is direct liability.